No savings but a happy life….. is it just me?

[CanICelebrate]

I read a lot of threads about savings and I wonder whether we are alone in having pretty much no savings despite earning a fairly good wage (although not rich by mn standards!)

For context, we have paid off quite a lot of our mortgage, have life insurance and have good pensions (also I will inherit a lot although hopefully not for a long time), so we definitely have money in the future, just no savings account right now.

We spend most of what we earn on having a better life with our dc.
I have had a number of tragedies in life and my own childhood was tough at times, so life seems fragile. I want my years with dc at home to be as good as they can and so we spend what we have on holidays, school fees (with huge discount as I work there), clubs/ activities and days out in school holidays. We don’t spend as much on ‘stuff’ but more on experiences. I’m pretty sure when dc have left home we will save more.

Am I being irresponsible? I don’t feel it day by day as I have no debt apart from my mortgage and a small car loan and my disposable income is high enough to cover minor emergencies, but reading threads on here I wonder whether I’m in a minority.

@Godwits

In your case I do think that you should save a little each month in case your children need braces

Good old NHS will cover that

I wouldn’t count on it, think braces will be way down the NHS priority list , I currently have a savings pot for DD’s teeth

We did actually pay for something medical privately recently for the first, and hopefully last, time and I did save up for it!

@CanICelebrate I'm a financial planner and the "official" advice is to have a minimum of 3 months worth of expenditure saved at all times. After this you should concentrate on paying off debts, then follow the PIPSI rule with any spare money - Protection, followed by Income Protection, Pensions, Savings (above your emergency fund) then Investments

I’m a single parent live month to month have no savings, put the money I do have into my house at least have done this year/ next year I want to take the kids on a nice holiday. Life is for living I say

@Bagelsandbrie I don’t have that much disposable income. It’s not thousands!
If something went really wrong with the house it would be a nightmare - that’s one of the things that is starting to worry me as things that were new in the house get older.

Your not being smug at all. I had no savings and would prefer to spend what extra cash I did have on my children, holidays and fun times. I know people who save and save have no children and do absolutely nothing. I think what are you saving for, I get rainy days but life is for living.

I am only saving now because I'm late in the game in wanting a mortgage so my children have a property they can use for however they want when I'm gone.

Good on you for being able to have great experiences with your family

I really would prioritise savings over 'experiences' with my DC - you can have great experiences that don't cost much or anything at all. Like you, DH & I have a comfortable income (athough not by Mumsnet standards ) but we have always saved and paid off our mortgage in our early 40s and have sufficient pensions & investments to retire before state retirement age. I was furloughed during the pandemic & DH had a pay cut but we were able to manage without worrying and that, to me, is worth far more than any 'experiences' we could buy for our DC.

[quote CanICelebrate]@moynomore

I’m really not at all. You don’t know anything about my life apart from the financial information I’ve given in my OP. I’m not a smug person in fact I’m a generous person who is immensely grateful for the good things in my life whilst also dealing with a lot of shit too.
Given all my subsequent posts I can only assume you wrote that comment to be deliberately unkind which says a lot more about you than me.[/quote]
Nope. I have read everything and still think you have no clue how sky high your privilege is. Having the privilege is one thing, but posting about it like this is another level. Sorry OP, I'm sure your don't mean to be smug, I really am, but you need to have some self awareness.

I also dont know why people prioritise savings and paying off mortgage early.
You need far more money when you have children than you ever will in later life. No point in being a rich old person and denying yourself or your kids a good life in your prime.

I dont really get it. No point in being richest in graveyard, and I just think all theses savers are just lining the pockets of the obscenely expensive care industry, with the direct sacrifice of their childrens icecreams.

Personally I like to have at least the value of few months salary saved up so that I have options to quit job, change career or ride out a redundancy if required. ( it was certainly handy when furloughed on 80% salary)
OP i wouldn't bank on inheritance being your safety net as there is significant tax (40%) to pay once above the personal threshold and this is likely to increase if Rishi has his way to fill the black hole deficit after furlough and Covid expenses for the government.
I would say its a bit silly not to have a bit of cash fluidity in your situation but thats entirely your choice. My MIL lives similarly to you and spends every penny she has, what then frustrates me with her though is the moaning and worry about unexpected expenses and bills that then end up as a phone call wanting a loan to tide her over!

Boat surely there is a balance - I don't think I've ever deprived my DC of an ice cream but we haven't spent ££££s on 'experiences' over the years but by making savings we can now help our DC out with Uni costs and hopefully something towards a deposit for their first home.

Yeah inheritance can try up from carehome costs. Seen this happen first hand. Would not rely on it at all.

@Disneycharacter

An inheritance can't be relied on. Money could go to care costs.

Not if proper estate planning has been done.

Wise up!

Yes, some self awareness would be a good start, and stop with the pity party if posters dont say you are wonderful

pity party

Dfod

I don’t want pity at all but obviously some people have judged me horribly by my OP so I thought I’d add balance by saying I don’t have a perfectly happy life!

I’m done arguing and defending myself. It’s my last Saturday of the summer holiday and I don’t want to spend it arguing with strangers!

It’s been really helpful to hear different perspectives and I’m glad I posted as I don’t really feel I can ask people about this in real life!!!

If you or your partner were unable to work for several years starting tomorrow, what would happen? If the answer is "Nothing much, because my rich parents would take care of the rest of our mortgage and pick up whatever was necessary for the children," then that's fine for you personally. But most people don't have that sort of safety net. For the rest of us, keeping enough on hand for "minor" emergencies and keeping our fingers crossed that "major" ones don't happen is too big of a risk.

[quote CanICelebrate]@Bagelsandbrie I don’t have that much disposable income. It’s not thousands!
If something went really wrong with the house it would be a nightmare - that’s one of the things that is starting to worry me as things that were new in the house get older.[/quote]
Then you really do need savings…!

I've always been very financially anxious. My mum never has any savings; she spends money as soon as she has it. She bought her small house with a very small mortgage when she divorced my dad, so low outgoings now, but also a low income. When my grandmother died 5 years ago, she inherited about £50k and it was all gone before covid; she went on holidays, had her house professionally redecorated, new clothes, changed cars, etc. She spends any disposable income on the same kind of things. I don't blame her AT ALL, she very very had a hard life and has a degenerative condition so probably won't be able to do as many 'adventurous' or 'fun' things when she retires... but it was very stressful growing up knowing that if something broke, there was no money to fix it. And I know it worried/worries her too.

I need savings to feel secure. We have the £ for a year of essential outgoings (i.e. we can pay bills and eat) in easily accessible accounts, which we are trying to build up to be a year of our normal earnings. And then we have sinking funds for literally every eventuality. Every single penny we earn is directed somewhere, either savings, sinking funds, investments, pensions, or specifically for miscellaneous spending.

Similar OP, we have very good pensions and a mortgage, well covered for insurance and should get a bit of inheritance (though not guaranteed) I know we are supposed to have X in the bank but we had our kids young, only have about 10-13 years of them financially dependent on us and we will then go on to have 20+ years before official retirement age to save whatever else we feel the need to, but right now barring what I've mentioned above I do believe in living in the moment to a degree, I want to go on that day out and that holiday, no good scrimping now to be flush later when it's just the 2 of us.

Hi OP, if you needed to make an emergency purchase, would your dad be able to help you? I think if there are people you could call on in an absolute financial emergency, then savings aren’t as crucial as someone who has no one to call on or no ability to get a short term loan etc.

You mention about your children having savings accounts and that’s definitely ‘savings’ as many people are saving for their children’s uni/car/house deposit and that’s what they mean when they say they have savings.

But anyway, I agree with a pp that the time for needing money and spending it is now when the children and you are young enough and in good enough health to enjoy it.

@Boatonthehorizon

I also dont know why people prioritise savings and paying off mortgage early. You need far more money when you have children than you ever will in later life. No point in being a rich old person and denying yourself or your kids a good life in your prime.

I dont really get it. No point in being richest in graveyard, and I just think all theses savers are just lining the pockets of the obscenely expensive care industry, with the direct sacrifice of their childrens icecreams.

We did it to try and ensure we had more money for the university years and to help,them with house deposits. It also freed up cash for some great city breaks when our children were late teens.

Selection bias.
Plenty of people live in the moment, have no savings and have carried on unhindered as nothing bad has happened.
But why would they post on MN?
That’s why you don’t see them.

But yes, plenty of people are like you. Some come to regret it and some don’t.